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A house sold for $39,379. The buyer paid 20% down. Monthly interest on the loan was $229.69. What was the annual interest rate on the loan?
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A house sold for $39,379. The buyer paid 20% down. Monthly interest on the loan was $229.69. What was the annual interest rate on the loan?

User Parker Kemp
by
5.0k points

1 Answer

3 votes

Answer:

8.75%

Step-by-step explanation:

The annual interest rate will be computed as follows:

Loan amount = Proportion of loan X Price of house

Loan amount = 80% X $39,379 = $31,503.2

Annual interest = $229.69 X 12 = $2,756.28

Annual interest rate = ($2,756.28/ $31,503.2) X 100%

= 8.75%

User Jay Lee
by
3.9k points
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